Balances January 1, current yearAccounts receivable (various customers)Allowance for doubtful accountsIn the following order, except for cash sales, the company sold merchandise and made collections on credit terms 2/10,n/30 (assume a unit sales price of $500 in all transactions).Transactions during current year:a. Sold merchandise for cash, $235,000.b. Sold merchandise to R. Smith; invoice price, $11,500.c. Sold merchandise to K. Miller; invoice price, $26,500.d. Two days after purchase date, R. Smith returned one of the units purchased in (b) and received account credit.e. Sold merchandise to B. Sears; invoice price, $24,000.f. R. Smith paid his account in full within the discount period.g. Collected $98,000 cash from customer sales on credit in prior year, all within the discount periods.h. K. Miller paid the invoice in (c) within the discount period.i. Sold merchandise to R. Roy; invoice price, $19,000.j. Three days after paying the account in full, K. Miller returned seven defective units and received a cash refund.k. After the discount period, collected $6,000 cash on an account receivable on sales in a prior year.1. Wrote off a prior year account of $3,000 after deciding that the amount would never be collected.m. The estimated bad debt rate used by the company was 1.5 percent of credit sales net of returns.2. Show how the accounts related to the preceding sale and collection activities should be reported on the current year incomestatement.Sales revenue$ 120,0008,000SYKES COMPANYIncome Statement (partial)For the Year Ended December 31, Current Year………Net sales revenueSelling, general, and administrative expensesBad debt expense

An income statement stands for the statement that shows profits and loss of the firm, its revenue…

Balances January 1, current year Accounts receivable (various customers) Allowance for doubtful accounts $ 120,000 8,000 In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 2/10, n/30 (assume a unit sales price of $500 in all transactions). Transactions during current year: a. Sold merchandise for cash, $235,000. b. Sold merchandise to R. Smith; invoice price, $11,500.

Balances January 1, current year Accounts receivable (various customers) Allowance for doubtful accounts $ 120,000 8,000 In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 2/10, n/30 (assume a unit sales price of $500 in all transactions). Transactions during current year: a. Sold merchandise for cash, $235,000. b. Sold merchandise to R. Smith; invoice price, $11,500.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 13P: Notes Receivable Transactions The following notes receivable transactions occurred for Harris...

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UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND PERCENTAGE OF RECEIVABLES At the completion of the current fiscal year ending December 31, the balance of Accounts Receivable for Yangs Gift Shop was 30,000. Credit sales for the year were 355,200. REQUIRED Make the necessary adjusting entry in general journal form under each of the following assumptions. Show calculations for the amount of each adjustment and the resulting net realizable value. 1. Allowance for Doubtful Accounts has a credit balance of 330. (a) The percentage of sales method is used and bad debt expense is estimated to be 2% of credit sales. (b) The percentage of receivables method is used and an analysis of the accounts produces an estimate of 6,950 in uncollectible accounts. 2. Allowance for Doubtful Accounts has a debit balance of 400. (a) The percentage of sales method is used and bad debt expense is estimated to be 1.5% of credit sales. (b) The percentage of receivables method is used and an analysis of the accounts produces an estimate of 5,685 in uncollectible accounts.
Notes Receivable Transactions The following notes receivable transactions occurred for Harris Company during the last three months of the current year. (Assume all notes are dated the day the transaction occurred.) Required: 1. Prepare the journal entries to record the preceding note transactions and the necessary adjusting entries on December 31. (Assume that Harris does not normally sell its notes and uses a 360-day year for the purpose of computing interest. Round all calculations to the nearest penny.) 2. Show how Harris notes receivable would be disclosed on the December 31 balance sheet. (Assume these are the only note transactions encountered by Harris during the year.)
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